First Quarter 2013 Earnings: Stonegate Bank Exceeds $1 Billion in Assets

First Quarter 2013 Earnings: Stonegate Bank Exceeds $1 Billion in Assets 
FORT LAUDERDALE, FL -- (Marketwired) -- 04/16/13 --  Stonegate Bank
(OTCBB: SGBK) 
First Quarter 2013 Highlights: 


 
--  Increased the annual dividend from $0.08 to $0.16 cents per share
--  Total assets of $1.04 billion
--  Net income of $2,293,000 for the first quarter of 2013
--  29 straight quarters of profitability
--  First quarter 2013 average net interest margin of 3.74%
--  Tier 1 risk based capital ratio of 16.1% at March 31, 2013

  
Stonegate Bank (OTCBB: SGBK) reported an increase in net income in the
first quarter of 2013 over the first quarter of 2012. Net income was
$2,293,000 or 27.8 cents per share for the first quarter of 2013, as
compared to net income of $2,242,000 or 27.2 cents per share in the
first quarter of 2012.  
Income and Expenses:
 Total interest income increased slightly from
$9.8 million in the first quarter of 2012 to $10.0 million in the
first quarter of 2013. This was achieved largely due to an increase
in loans of $91 million despite an overall decrease in investment
income of $217,000 period to period. Total interest expense decreased
from $1.88 million in the first quarter of 2012 compared to $1.72
million in the first quarter of 2013. This occurred even though total
deposits increased $134 million period to period. Further, the Bank's
cost of funds for March 2013 decreased 21 basis points from March
2012. The result is an improvement in net interest income from $7.9
million in the first quarter of 2012 to $8.3 million in the first
quarter of 2013.  
Total non-interest income decreased to $856,000 in the first quarter
of 2013 from $1,079,000 in the first quarter of 2012. The largest
change in non-interest income was a decrease of $336,000 in
derivative fees period to period.  
The Bank realized security gains of $745,000 in the first quarter of
2013. These gains were taken largely to reduce the size of the
investment portfolio and to shorten the duration of the portfolio.  
Non-interest expense increased to $6.0 million for the first quarter
of 2013 from $5.8 million for the first quarter of 2012. The increase
in non-interest expense is related to the addition of the Bank's
Doral office in the fourth quarter of 2012.  
Margin and Cost of Funds:
 Total cost of funds declined from a 0.92%
December 2012 month-to-date average to 0.82% March 2013 month-to-date
average. Stonegate Bank's net interest margin declined from a fourth
quarter 2012 average of 4.09% to 3.74% first quarter 2013 average.
Excess liquidity due to strong deposit growth contributed to the
decline in the net interest margin. The timing of various recoveries
associated with discounted assets was also a factor. The Bank has
approximately $4.4 million in accretable discounts and $11 million in
non-accretable discounts as of March 31, 2013. Management is
currently evaluating these discounts to determine whether a
percentage should be amortized over the life of the asset.  
Balance Sheet and Capital:
 Total assets grew from $899 million on
March 31, 2012 to $1.04 billion on March 31, 2013, a $141 million
increase. Total loans increased $91 million from $633 million on
March 31, 2012 to $724 million on March 31, 2013. Total deposits
increased $134 million from $712 million on March 31, 2012 to $846
million on March 31, 2013. Non-interest bearing deposits represent
15.8% of total deposits. Total capital grew from $119.7 million on
March 31, 2012 to $127.6 million on March 31, 2013. The undiluted
book value of common shares of Stonegate Bank was $15.49 per share on
March 31, 2013.  
Asset Quality: 


 
                                                        
                   Total Stonegate Bank - March 31, 2013
                   In thousands                         
                                                        
                   Total loans                  $724,495
                   30 days past due                  892
                   60 - 89 days                      593
                   NPAs                            6,529
                   REO                             3,832

 
The table above shows the various categories and ending balances of
past due loans, nonaccrual loans as well as real estate owned.
Overall, non-performing loans represent 0.9% of total loans and 0.62%
of total assets. Approximately 19% of the nonaccrual loans are
current.  
Management believes all non-performing assets and REO are written
down to fair market value. Real estate owned increased slightly from
$3.2 million on December 31, 2012 to $3.8 million on March 31, 2013.  
The Bank's loan loss reserve was $16.1 million on March 31, 2013.
This reserve represents 246% of all non-performing loans and 2.22% of
total loans. Total loans past due more than 30 days decreased from
$3.246 million on December 31, 2012 to $1.485 million on March 31,
2013.  
Management Comments:
 "The first quarter witnessed two major events
for Stonegate," said Dave Seleski, President and Chief Executive
Officer. "First, the Bank's assets exceeded $1 billion for the first
time. Since inception, this has been a goal for the Bank, and I am
very proud that we were able to achieve this without taking undue
risk or sacrificing profitability for growth. Second, the bank
doubled its dividend from $0.08 cents per share in 2012 to $0.16
cents per share in 2013. In the future we hope to continue to reward
our investors as the Bank grows and matures."  
"Once again, we see economic improvement in our local markets. A
large part of this is being driven by foreign investors as well as
appreciation and increased demand for residential housing. The
trickle-down effect has certainly stabilized our markets and in some
cases led to a surprising increase in economic activity. We
anticipate this to continue and are focused on growing the Bank
organically in each of our markets. It is also our sense that after a
significant hiatus, merger and acquisitions in Florida are going to
increase in 2013. We will look at these opportunities as a way to
increase our overall market share in the communities we serve," added
Seleski. 
The Bank cautions that certain statements contained in this press
release are "forward-looking statements" as defined under the Private
Securities Litigation Reform Act of 1995, which statements are made
pursuant to the "safe harbor" provisions of such Act. These
forward-looking statements describe future plans or strategies and
may include the Bank's expectations of future financial results. The
words "believe," "expect," "anticipate," "estimate," "project," and
similar expressions identify forward-looking statements. The Bank's
ability to predict results or the effect of future plans or
strategies or qualitative or quantitative changes is inherently
uncertain. Actual results may differ materially from stated
expectations. Specific factors include, but are not limited to,
changes in general market interest rates, changes in general economic
conditions and those specific to the Bank's market area,
legislative/regulatory changes, monetary and fiscal policies of the
U.S. Treasury and the Federal Reserve, changes in the quality or
composition of the Bank's loan portfolios, demand for loan products,
changes in deposit flows, real estate values, and competition and
other economic, competitive, governmental, regulatory and
technological factors affecting the Bank's operations, pricing,
products and services. The
 Bank makes periodic filings to the Federal
Deposit Insurance Corporation which contain various Bank financial
information, copies of which are available from the Bank without
charge. The Bank disclaims any obligation to update any such factors
or to publicly announce the results of any revisions to any
forward-looking statements contained in this release to reflect
future events or developments. 


 
                                                                            
                               STONEGATE BANK                               
                               Balance Sheet                                
                            As of March 31, 2013                            
                                                                            
(In Thousands)                                                              
                                                                            
Assets                                                                      
Cash and due from banks                                         $   166,834 
Federal funds sold                                                        - 
Investment securities                                               106,261 
                                                                            
Commercial loans                                                     98,587 
Commercial real estate loans - owner occupied                       175,723 
Commercial real estate loans - other                                247,474 
Construction loans                                                   46,494 
Residential 1 - 4 family loans                                      110,317 
HELOCs                                                               36,482 
Consumer loans                                                        9,418 
                                                                ----------- 
  Gross loans                                                       724,495 
Allowance for loan losses                                           (16,149)
                                                                ----------- 
  Net loans                                                         708,346 
                                                                            
Fixed assets                                                         12,844 
Other assets                                                         45,942 
                                                                ----------- 
  Total assets                                                  $ 1,040,227 
                                                                =========== 
                                                                            
Liabilities                                                                 
Non-interest bearing deposits                                   $   134,224 
NOW accounts                                                         63,369 
Money market accounts                                               372,427 
Core reciprocal deposits                                            184,809 
Savings accounts                                                      6,542 
Certificates of deposit                                              84,958 
                                                                ----------- 
  Total deposits                                                    846,329 
Repurchase Agreements                                                30,100 
FHLB and other borrowings                                            20,060 
Other Liabilities                                                    16,092 
                                                                ----------- 
  Total liabilities                                                 912,581 
                                                                            
Total capital                                                       127,646 
                                                                ----------- 
  Total liabilities and capital                                 $ 1,040,227 
                                                                =========== 
                                                                            
                                                                            
                                                                            
                               STONEGATE BANK                        
                              Income Statement                       
                      For Period Ended March 31, 2013                
                                                                     
      (In Thousands)                                                 
                                                                     
      Interest income                                      $   10,015
      Interest expense                                          1,723
                                                           ----------
        Net interest income                                     8,292
      Less: Provision for loan losses                             273
                                                           ----------
        Net interest income after provision for loan                 
         losses                                                 8,019
      Non-interest income                                         856
      Realized gains (losses) on AFS securities                   745
                                                                     
      Less: Salaries and benefits expense                       3,498
          Occupancy and equipment expense                         919
          Data processing expense                                 206
          Legal and professional expenses                         477
          Loan and OREO expenses                                  191
          Other expense                                           745
                                                           ----------
        Total non-interest income                               6,036
                                                                     
      Net income before income taxes                            3,584
      Income taxes                                              1,291
                                                           ----------
        Net income                                         $    2,293
                                                           ==========

  
MEDIA CONTACT: 
Sissy DeMaria 
(sdemaria@krepspr.com) 
Suzanne Schmidt 
(sschmidt@krepspr.com) 
Kreps DeMaria 
(305) 663-3543 
INVESTOR RELATIONS:
Dave Seleski 
(dseleski@stonegatebank.com)
Stonegate Bank
(954) 315-5510 
 
 
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